• 455 days Will The ECB Continue To Hike Rates?
  • 455 days Forbes: Aramco Remains Largest Company In The Middle East
  • 457 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 857 days Could Crypto Overtake Traditional Investment?
  • 861 days Americans Still Quitting Jobs At Record Pace
  • 863 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 866 days Is The Dollar Too Strong?
  • 867 days Big Tech Disappoints Investors on Earnings Calls
  • 868 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 869 days China Is Quietly Trying To Distance Itself From Russia
  • 870 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 874 days Crypto Investors Won Big In 2021
  • 874 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 875 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 877 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 877 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 881 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 881 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 882 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 884 days Are NFTs About To Take Over Gaming?
Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

  1. Home
  2. Markets
  3. Other

Gold Market Update

Having broken out upside from its 3-month long trading range, which was not expected in the last update, gold is now theoretically in position to continue to advance, and may end the current intermediate uptrend by staging a vertical blowoff move. However, the recent advance looks insipid when compared to silver - gold is still only about $15 above the high attained early in February, and in the event of a downturn it is unlikely to find much support in the January - March trading range, because it has not risen sufficiently far away from it. We can observe these points on the 6-month chart, on which we can see that the RSI and MACD indicators are not at overbought extremes, and thus there is room for further short-term gains. The gap with the moving averages remains large, however, and on the 5-year chart we can see that the rate of rise of these indicators is very steep, and thus continues to point to a correction.

On the 5-year chart we can further observe how gold has succeeded in breaking out upside from its long-term uptrend channel, an event that quite frequently leads to a vertical blowoff move, that is followed by an abrupt reversal, especially if, as is the case here, the price is already way above its long-term moving average, signalling that the intermediate uptrend is mature. Not only is the price way above the 200-day moving average, but this indicator is now rising at a very steep rate - a rate that is regarded as unsustainable.

In conclusion, although further short-term upside potential exists for gold, and the current uptrend from the fall of last year may end with a vertical spike, this uptrend is believed to be getting close to terminating. This fits with silver which is getting close to burnout and is likely to go into sudden reverse.

 

Back to homepage

Leave a comment

Leave a comment